Are we going to witness an historical housing price correction amid sharpest rise in unemployment and social tension?...and the minimum you should know in order to protect yourself from this downturn from an economic, stock market and political point of view... with a pinch of humor and sarcasm.

Thursday, 27 March 2008

Sampo or Is There Still a Finnish Bank Around?

"Problems that emerged with the new online banking system of Sampo Bank on Tuesday were not limited to breaks in service and incorrect or missing information on money transfers and bank balances"

"The glitches, that continued on Wednesday, were prompted by changes enacted at Sampo aimed at integrating its operations with the Danish Danske Bank, which bought Sampo last year. "

"One customer in the Uusimaa (Helsinki) region noticed on Wednesday that his monthly housing loan payment had been deducted from his account twice. "

Humm...looks like Danske bank is in need of fresh cash...since they are trying to get twice the money from that poor customer...well he will get it back after few days...hopefully with interest...since this time it's the customer that lent money to the bank...

Nethertheless , the question you migh ask is : do we still have major Finnish bank in Finland? Nordea is Swedish, Sampo is now Danish...now the second question would be : Do we then need Financial Watchdog and a Central banker like Erkki Liikanen? Well hard to say since they have no control of foreign banks... Welcome to the financial "wild wild west", where Erkki is driving the main car without wheel...or it's as well like Tarja Halonen being president but without the power or like the U.S. financial system without corrupt Paulson ...

As they say too "big to fail", this two doesn't enter in this category...these are small banks that you wonder where they are going to make profit in the next few years as loan for housing purchase is going to decelerate substantially...

Don't know the inside and neither want to speculate wether or not they will be able to handle the current crisis...Let's just hope that those banks have not invested or are exposed to "toxic" investment i.e: subprime or commercial real estate funding...we will see in the next quarters how their balance sheet will show up...and let's hope for them that the housing price stay stable or get higher otherwise their might have to look for funding as their collateral is slowly vanishing...

At the end let's hope for the "small" Finnish banks and European banks the "housing bubble" is a myth ...I guess 2009-2010 will show by how much house price have been inflated and how much consumers have had leverage...and let's hope too that inflation will go down as planned by the ECB in 2009 otherwise you know it will be a replay of 1989...